Pinpoint Markets, 5.9.26: Why a weak job market seems strong

Plus, over- and undervalued stocks, the Iran war till Labor Day, and a startling midterm development

5 THINGS WORTH KNOWING, PLUS 11 AWESOME CHARTS:

Jobs, meh. Economists liked the April jobs report, because it “beat expectations.” But workers worried about stagnant pay and eroding job security don’t give a hoot about those types of numerical technicalities. And consumer surveys show most Americans find the job situation pretty disappointing.

The average forecast was for about 60,000 new jobs in April, and employers ended up creating 115,000 new jobs. So at the headline level, it seems like a win. Hiring expanded from a few narrow sectors earlier in the year—mostly health care and social services—to construction, retail, trade and transportation, and leisure and hospitality. The unemployment rate stayed steady at 4.3%.

But the trends are still lousy. Longer-term data shows the job market weakening, as you can see in the charts below. While job growth was pretty good in both March and April, the economy has shed jobs in five of the 15 months since President Trump took office in 2025. Employment growth has averaged just 31,000 new jobs per month since Trump became president. In 2024, it averaged 122,000 new jobs per month, nearly four times as much.

The unemployment rate has remained steady for the last several months, but it’s nearly a point higher than at the low in 2023, when it bottomed at 3.4%.

Trump’s tariffs are supposed to revive manufacturing, but there are fewer blue-collar jobs than when Trump took office.

Most of the hiring is still concentrated in health care and social services. There’s nothing wrong with those jobs, but they don’t boost the productive capacity of the economy like growth in other sectors might. There’s been a notable decline in business-service employment, a large sector with many good-paying white-collar jobs. Four other major sectors have lost jobs during the last year.

[Get all the facts on the middling Trump economy]